A smuggling lawsuit filed in September against two top executives at Breakthru Beverage Group, an alcohol wholesale company co-led by Blackhawks Chairman Rocky Wirtz, has been dismissed by a federal judge.

Empire Merchants, a New York wine and spirits distributor, alleged in U.S. District Court in New York that Breakthru Co-Chairman Charles Merinoff, Chief Executive Gregory Baird and others were involved in a scheme in which Maryland wholesalers sold alcohol that eventually was smuggled into New York and sold illegally to avoid paying that state's higher taxes, costing Empire and the state of New York tens of millions of dollars.

"We were confident from day one that we would prevail and are gratified that the court ruled in our favor," Rocky Wirtz, Breakthru co-chairman, and Danny Wirtz, vice chairman, said Thursday in an email to workers. "We are thankful for the many who stood by our side, including our suppliers and many others in our industry."

Breakthru Beverage is the merged business of Wirtz Beverage Group and the Merinoff family's Charmer Sunbelt. Reliable Churchill, one of the Maryland wholesalers that allegedly participated in the scheme, was owned by Charmer Sunbelt and is part of Breakthru Beverage.

According to the suit, Reliable Churchill helped sell excessive amounts of alcohol to retailers in Cecil County, Md., from at least 2008 through 2014. The retailers, in turn, sold the alcohol to New York retailers, which drove vans or trucks to Maryland to pick up the product. The wholesalers had "actual or constructive knowledge of these smuggled sales," the suit alleged.

The lawsuit accused the executives, both formerly of Charmer Sunbelt, of unfair competition, deceptive trade practices and mail fraud, among other allegations.

But in a 37-page opinion and order issued Thursday, Judge Allyne Ross dismissed the claims.

For example, "Empire alleges that defendants committed mail fraud," the judge wrote. "However, plaintiff's amended complaint fails to identify any specific use of the mails by defendants."

The judge also found that the defendants' conduct "was not deceptive" for a variety of reasons.

"The Maryland wholesalers and retailers, who were sellers of the liquor, were not deceived — they knowingly participated in the scheme," Ross wrote. "The New York retailers, who purchased the liquor, were also knowing participants."

Randy Mastro, an attorney for Empire, said in an emailed statement that the company is "disappointed that the court decided to dismiss the federal lawsuit based on technical legal grounds."

"At its core, Empire Merchants' lawsuit is about a massive bootlegging scheme in which Reliable Churchill was a central participant," Mastro said. "Since the lawsuit's filing, six of Reliable Churchill's co-conspirators have come forward to corroborate under oath its role in this bootlegging scheme."

Empire is weighing its options for appeal at the federal level and also will continue pursuing the matter in state court, he said.

A version of this article appeared in print on March 18, 2017, in the News section of the Chicago Tribune with the headline "Judge tosses suit against top executives at Wirtz-led firm" —
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